CASE PROBLEMS

case 2.1 Ford & Burbage

George Williams joined Ford & Burbage, a civil engineering firm after graduating from college with a degree in sales. He spent six months learning the services of his firm and how to put together pricing proposals before getting his first territory, including all of Florida and the coastal area of Alabama. Ford & Burbage had once been a leader in that region and still enjoyed a strong reputation, but the previous salesperson hadn't worked very hard. As a result, George was able to show strong sales growth by simply working hard.

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Within six months, however, he began to get the same e-mail from client after client. "George, please explain your firm's pricing to us, line item by line item." After the fifth such e-mail, he forwarded it to his manager, Mackie Hall, who was based in the Atlanta office of Ford & Burbage.

As soon as she saw the e-mail, Mackie picked up the phone and called him. "You need to be careful; it looks like you've got Stevens McBride trying to pick off your customers," she told him. Their strategy is to tell customers our prices are higher and prove it by showing a line-item comparison. But actually, it's how the company defines each line that differs, and when you add it up, we're less expensive by some 15 to 20 percent."

"How do I prove that we're not more expensive?" asked George.

"It's hard because Stevens McBride won't show the client a full price list. To make matters worse, we also filed a lawsuit against them because their salespeople keep telling clients we're going out of the civil engineering business."

"Oh, that explains why I've gotten that question a few times recently."

Questions

1. How do you respond to the pricing issue if you can't actually prove Stevens McBride is lying? How would you handle a customer who goes with Stevens McBride and then realizes it costs more?
2. How do you respond to the question about leaving the business?
3. What if a client asked about the lawsuit directly, saying, "I hear your company filed suit against Stevens McBride. Wasn't that a cheap shot at a competitor?"
4. Note: This scemario is based on a situation faced b one of our former students. The names and industry have been changed. but the situation is real